Sunday, March 29, 2009

Supply and Demand in Action, Part II

4 Comments:

With this post, as well as those from other states showing the same results, it would be interesting to know the data about the mortgages, i.e., though home affordability, as you have pointed it, has reached the best levels ever, are the mortgages for these better, safer products with more sound lending practices being implemented? Just curious. Good to see markets in action though.

On an inflation adjusted basis, homes prices have fallen 33% from the peak in 2005. The below chart shows single family home prices are now back in a range that existed from the late 1970s into the mid-1990s.

Chart of the Day notes, "...a home buyer who bought the median priced single-family home at the 1979 peak has actually seen that home lose value (1.6% loss). Not an impressive performance considering that nearly three decades have passed."